Audit referendum fails but questions of city performance remain

What began with a poll suggesting that more than 80 percent of Austinites supported an independent audit of city departments ended in a drubbing on election night.

A heavy surge of midterm voters in Austin, energized by presidential politics, an expensive and competitive U.S. Senate race, and a $925 million city bond package, dealt Proposition K– the audit question on the ballot — a 58-42 percent defeat.

Spokespersons for both sides of that question agreed that, fairly or unfairly, Proposition K was a referendum on the motives rather than the merits of paying for an outside review of how city services are provided.

Michael Searle, who formed a political action committee, Citizens for an Accountable Austin, and succeeded in getting the issue on the ballot, never wavered in his insistence that all Austinites would benefit from a more efficiently run city government.

His opponents, most prominently Mayor Steve Adler and local political operative David Butts, kept the focus on how Searle funded his petition drive, with money from donors whose identities Searle was legally allowed to keep secret.

Butts, in particular, linked what he called “dark money” donors to prominent conservative organizations like the Austin-based Texas Public Policy Foundation and the American City County Exchange. Political advertising on the audit question featured a cartoon showing a Trojan elephant wheeled in to undermine a progressive Austin.

“They used the tried and true tactic of floating the boogeyman with unsubstantiated fear-mongering every day,” Ed English, one of Searle’s chief tacticians, told The Texas Monitor. “The opposition couldn’t make the argument that an audit that saves money is a bad idea, so they played the fear card. In all the emotionalism, you can miss the issue completely.”

The day after the election Butts had not backed away from his contention that Proposition K was being pushed by state conservative interests that for at least three years have battled with Austin’s mayor and city council over local control, on issues like regulating ride sharing and, most recently, paid sick leave.

“I didn’t see any hue and cry for an external audit, for a referendum on it,” Butts told The Texas Monitor. “But if you did a little digging into the origins of the concept backed by all this dark money, it led to people trying to embarrass the city. They are not friends of Austin.”

Before launching his petition drive, Searle solicited the support of several prominent progressive activists, including attorney Fred Lewis and Bill Bunch, the executive director of the Save Our Springs Alliance. Lewis and Bunch contended publicly that an audit of a kind never done by the city was nonpartisan and long overdue.

But at a city council meeting in August, a week after the city clerk certified Searle’s petition, Butts came before the council for the first time alleging his conservative conspiracy theory. Unspoken at that hearing was Butts’ role as a paid consultant for the election campaigns of Adler and at least half of the 10 current members of the council.

The council decided against voting directly on the audit, instead approving the complicated language of the Proposition K question that appeared on Tuesday’s ballot. A lawsuit filed on behalf of English and Citizens for an Accountable Austin to force the city to rewrite the “unlawful” language failed before the Texas Supreme Court.

“The ballot language was written by the city council to intentionally mislead and dissuade voters,” Searle told The Texas Monitor Wednesday.

Still, heading into election day Searle and English said they would have given even odds that Proposition K would pass. In a normal midterm election, the outcome might have been closer, but Democrats in Travis County had added motivation to come to the polls.

The election will be remembered as a referendum on the performance of President Donald Trump, reverberating through state and local contests. Travis County voters were part of a wave that brought Beto O’Rourke within four percentage points of defeating U.S. Sen.Ted Cruz.

And with nearly a dozen referenda on the ballot, the Travis County Democratic Party weighed in to urge voters to reject the audit, the last question on the ballot.

In the 2014 midterm, 40.4 percent of registered voters in Austin voted in the mayor’s race. This year almost 300,000 or nearly 60 percent of registered voters voted for mayor, almost the same number who voted on Proposition K. Nearly 50,000 more votes were cast against it than for it.

Austin residents knew very well what they were voting against, Butts said. “There is nothing illegal about dark money, but people here in Austin sure don’t like it,” he said. “And we took it and beat them over the head with it.”

Butts said he was not opposed to the audit on its face. Had the city council seen the need and approved one, Butts said he might have supported it. He doubted, however, that an effective audit of all city departments including the utilities could have been done for even the $5 million cost ceiling included in the Proposition K question.

Mostly overlooked throughout the audit debate was the Zucker Report, produced the last time the city council approved funding for a major independent audit, $250,000 to review what was then called the Planning and Development Review Department.

In 2015, the report’s author, the late Paul Zucker, concluded that the department was one of the worst his company had ever reviewed. He criticized what he referred to as the “Austin Way,” an almost confrontational attitude within the department that made developing anything in Austin slow and expensive. Zucker also concluded the department was woefully understaffed.

The council approved hiring 26 new employees following the release of the Zucker Report. In its approval of a $4.1 billion budget in September, the council agreed to allow the renamed Development Services Department to hire another 52 full-time people.

In their op-ed calling for voters to approve Proposition K, city council members Ora Houston and Ellen Troxclair touted the Zucker Report for having spurred reform of the development process in Austin.

Department director Rodney Gonzales told The Texas Monitor the new employees, more than half of them in inspections, should be in place by the middle of December. Three years after the Zucker report, Gonzales said, there is a marked change in the culture of his department.

“We’ve been trying to create a culture of customer service,” he said. “We’re embedding that in everything we do.”

To fund the new personnel, however, the department was allowed to raise its permitting fees by hundreds of dollars for even small projects like adding a deck on a home.

The Texas Monitor interviewed half a dozen people in the development industry who work with the department every day. None would go on record for fear that public comments might make it even harder to do business with the city.

All agreed that the department labors under the labyrinthine land development code that the city temporarily abandoned rewriting in August after six years and $8 million in cost overruns.

And all said that sections within the department have not yet embraced the cooperation necessary for good customer service. The result is one of the slowest and most expensive development processes in Texas.

“There are still so many things to fix,” one developer with 30 years of experience told The Texas Monitor. “Just adding people isn’t going to fix it. Everything’s too fragmented. It’s been that way as long as I’ve been doing this.”

The Zucker audit showed the need for reform in a single department, irrespective of the varying policy views of the council members who approved it, Searle said.

Despite a crushing loss, Searle said he’s more convinced than ever that “Austinites want transparency and more efficiency in city government” but he also learned that “They won’t get it without a fight.”

Mark Lisheron has more than 30 years of experience in newspapers and was most recently the managing editor for Reason.com. He also served as deputy editor, national reporter and Austin bureau chief for Watchdog.org. He was the founding Austin bureau chief for the bureau's predecessor, Texas Watchdog, winning the First Amendment Award from the Society of Professional Journalists in Texas.

The city of Austin budget is $4.1 billion dollars = the size of the state budget of Delaware. Surely, there are areas for improvements that could be identified, and then City Council would have to decide to act on the recommendations.